The FTSE 100 is lower ahead of the BoE decision
The FTSE 100 is trading lower on Thursday morning, closer to 10,440 than the 10,450 pre-open level flagged in the original note. The move follows two sessions of gains and comes as investors wait for the Bank of England's latest interest-rate decision.
The weakness is not only about domestic data. Energy and mining shares are weighing on the index as oil and base-metal prices soften, while Tesco is also under pressure after first-quarter UK comparable sales came in below expectations. That leaves the broader UK market vulnerable to a cautious tone from policymakers later in the day.
The labour-market data were stronger, but not clean
The first important UK data release came from the labour market. The Office for National Statistics said the unemployment rate fell to 4.9% in February to April 2026, below expectations for 5.0% and down 0.3 percentage points on the latest quarter.
The payroll figures were also better than feared on the headline. The early estimate for May showed payrolled employees rising by 2,000 on the month, compared with expectations for a fall. However, the ONS stressed that this estimate is provisional, and payrolled employees were still down by 119,000 over the year. Vacancies also fell to 707,000, their lowest level since February to April 2021.
Wages keep the inflation question alive
The wage data are another reason the Bank of England is unlikely to sound relaxed. Regular pay rose 3.4% year on year in February to April, while total pay including bonuses rose 4.4%. Public-sector regular pay growth was stronger at 5.1%, although the ONS said this was affected by the timing of pay awards.
